The Dollars And Cents Of Common Sense: BENN
Common sense is not so common, particularly at Ottawa City Hall.
The reality is that the offer of a $300,000 ex gratia contribution by a developer should have been shut down on Day 1. There is a perception that the development industry exerts too much influence on the business affairs of the city. That should not be a surprise to anyone who reports to work at city hall. Not to staff, not to senior management, not to elected officials nor their political handlers.
That the city did not have a policy to address this is unfortunate, but not surprising. But just because there isn’t a policy precluding it doesn’t mean that it wasn’t poor political judgment.
For example, until a few years ago, the city did not have a policy that prevented the chairwoman of the planning committee from hiring the offspring of a person who provides services to businesses that are seeking variances to existing zoning. Common sense, had it been exercised by then-councillor and chairwoman Jan Harder, would have said that this creates not just the appearance of a conflict of interest, it creates a de facto conflict of interest. Harder refused to acknowledge that even the remotest of possibilities existed that there might, just maybe, be a conflict of interest. How did she know she was right? Well, city council accepted her resignation without censuring her behaviour. After all, there wasn’t a policy that precluded this type of decision.
Let’s not forget the $100,000 plus fiasco involving the transfer of city funds to an on-line fraud artist. The then-treasurer of the City of Ottawa, Marion Similuk, signed off on the transfer of more than $100,000 based on an email that she received, thinking it was from the city manager Steve Kanellakos. An e-mail stated it was for a secret report that he had commissioned. One that did not have a supporting invoice. Look, these things happen … to organizations that don’t require multiple signatures on wire transfers. That don’t require documentation to support a transaction. One is left to wonder how often secret transactions are entered into at city hall. After all, apparently, there wasn’t a specific policy against paying amounts for secret transactions.
To be fair, there are policies that prevent or limit staff, senior management and elected officials from accepting gifts and the sort from organizations doing business with the city. How the city enforces these policies is a separate question.
There is a lobbyist registry to give at least the illusion of full disclosure. The challenge is that the nature of the business discussed can be so generic as to be meaningless. Is that by design or just a lack of complete thought?
There is a policy, actually a provincial regulation, that allows councillors to accept campaign donations from people associated with businesses that are doing business with the city. These contributions are disclosed post-election, i.e. after the votes have been cast. Kind of like noting the barn door is open, but not thinking it appropriate to close it before the horses escape. That the reports don’t require the identification of individuals who are principals of organizations doing business with the city is a mere design flaw. A design flaw that no one in a position of power is prepared to address.
I am not a fan of unnecessary policies, but as a now retired chief financial officer, I recognize that for many people, the absence of a policy is a licence to stretch the bounds of common sense. But only if they have the best of intentions.
Ron Benn, a finance executive, has been a member of the Centrepointe Community Association for the better part of three decades.
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Section 37 of the Planning Act used to allow for the City to ask for benefits to construct, fund or improve facilities when a development required a Zoning By-law amendment. It appears to be replaced or modified by a Community Benefits Charge in 2022. If I understand, a CBC by-law has to be put in place by the municipality to enable CBCs. In practice, the subject $300,000 looks to me a lot like a CBC, but perhaps without a CBC by-law in place. Understanding that developers might not have liked the old Section 37, I doubt if they were lobbying for a CBC by-law to be enacted by the municipality. And I doubt if the pro-development wing of Council have been proactive about a CBC by-law. So is the lack of a CBC by-law effectively is the issue here? All this to say, from where I sit, the $300,000 looks a lot like the old Section 37 and not a particularly new concept.
John, there is an important distinction between the former Section 37 requirements and the community benefits contribution that which Councillor Menard negotiated.
Section 37/Community Benefits Charges were/are negotiated during the process of the zoning variance application, forming part of the terms and conditions of the granting of the variance. Thinking in the context of contract law, these payments are part of the consideration given by the developer in consideration of receiving “current favours”, to wit, the approval of the variance.
In contrast, the proposed transaction between Katasa and the city, as negotiated by Councillor Menard, took place after the zoning variance application had been approved. With the consideration is being offered post transaction, it leaves open to question what consideration will be going in the other direction – to wit, “future favours”.
One should keep in mind that there is a well earned perception that “favours” are a currency for politicians. Along the lines of “In consideration of you voting in favour of my ill-considered resolution, I agree to vote in favour, at some time in the future, one of your self serving resolutions.” … or tacit thoughts to that effect.